Judge: Walter P. Schwarm, Case: 30-2020-01167409, Date: 2022-12-06 Tentative Ruling

Defendants’ (OHL, USA, Inc., Astaldi Construction Corporation and OC 405 Partners Joint Venture) Motion for Summary Adjudication (Motion), filed on 9-22-22 under ROA No. 157, is GRANTED in part and DENIED in part.  The Notice of the Motion (Notice) was filed on 9-22-22 under ROA No. 165.

The court GRANTS Defendants’ Request for Judicial Notice, filed on 9-22-22 under ROA No. 163, pursuant to Evidence Code section 452, subdivision (d).

The court OVERRULES all of Defendants’ objections contained in Defendants’ Objections to Evidence Submitted in Support of Plaintiff’s Opposition to Motion for Summary Adjudication filed on 12-1-22 under ROA No. 181.

Code of Civil Procedure section 437c, subdivision (p)(2) provides, “A defendant . . . has met his or her burden of showing that a cause of action has no merit if that party has shown that one or more elements of the cause of action, even if not separately pleaded, cannot be established, or that there is a complete defense to that cause of action.  Once the defendant . . . has met that burden, the burden shifts to the plaintiff . . . to show that a triable issue of one or more material facts exists as to that cause of action or a defense thereto.” 

Code of Civil Procedure section 437c, subdivision (f), provides, “A party may move for summary adjudication as to one or more causes of action within an action, one or more affirmative defenses, one or more claims for damages, or one or more issues of duty, if the party contends that the cause of action has not merit, that there is no affirmative defense to the cause of action, that there is no merit to an affirmative defense as to any cause of action, that there is no merit to a claim for damages, as specified in Section 3294 of the Civil Code, or that one or more defendants either owed or did not owe a duty to the plaintiff or plaintiffs.  A motion for summary adjudication shall be granted only if it completely disposes of a cause of action, an affirmative defense, a claim of damages, or an issue of duty. [¶] (2) A motion for summary adjudication may be made by itself or as an alternative to a motion for summary judgment and shall proceed in all procedural respects as a motion for summary judgment. A party shall not move for summary judgment based on issues asserted in a prior motion for summary adjudication and denied by the court unless that party establishes, to the satisfaction of the court, newly discovered facts or circumstances or a change of law supporting the issues reasserted in the summary judgment motion.” 

Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850-851, (Aguilar), states, “Second, and generally, the party moving for summary judgment bears an initial burden of production to make a prima facie showing of the nonexistence of any triable issue of material fact; if he carries his burden of production, he causes a shift, and the opposing party is then subjected to a burden of production of his own to make a prima facie showing of the existence of a triable issue of material fact. Although not expressly, the 1992 and 1993 amendments impliedly provide in this regard for a burden of production as opposed to a burden of persuasion. A burden of production entails only the presentation of ‘evidence.’ (Evid. Code, § 110.) A burden of persuasion, however, entails the ‘establish[ment]’ through such evidence of a ‘requisite degree of belief.’ (Id., § 115.) It would make little, if any, sense to allow for the shifting of a burden of persuasion. For if the moving party carries a burden of persuasion, the opposing party can do nothing other than concede. Further, although not expressly, the 1992 and 1993 amendments impliedly provide for a burden of production to make a prima facie showing.  A prima facie showing is one that is sufficient to support the position of the party in question. [Citation.]”  (Italics in Aguilar; Footnotes 13 and 14 omitted.) 

Binder v. Aetna Life Ins. Co. (1999) 75 Cal.App.4th 832, 838 (Binder) states, “Although summary judgment might no longer be considered a ‘disfavored’ procedure, [citation], the rule continues that the moving party's evidence must be strictly construed, while the opposing party's evidence must be liberally construed.” “On a summary judgment motion, the court must therefore consider what inferences favoring the opposing party a factfinder could reasonably draw from the evidence. While viewing the evidence in this manner, the court must bear in mind that its primary function is to identify issues rather than to determine issues. [Citation.]” (Id., at p. 839.)

Cole v. Town of Los Gatos (2012) 205 Cal.App.4th 749, 756-757, provides, “The plaintiff can defeat a defense motion for summary judgment by showing either that the defense evidence itself permits conflicting inferences as to the existence of the specified fact, or by presenting additional evidence of its existence. [Citation.] The dispositive question in all cases is whether the evidence before the court, viewed as a whole, permits only a finding favorable to the defendant with respect to one or more necessary elements of the plaintiff's claims—that is, whether it negates an element of the claim ‘as a matter of law.’ [Citation.]”

Nazir v. United Airlines, Inc. (2009) 178 Cal.App.4th 243, 252 (Nazir), states, “We offer two observations about this footnote. The first is that it ignores the advice from the leading practice treatise: ‘PRACTICE POINTER: [¶] ... [¶] Include only those facts which are truly material to the claims or defenses involved because the separate statement effectively concedes the materiality of whatever facts are included. Thus, if a triable issue is raised as to any of the facts in your separate statement, the motion must be denied!’ [Citation.]” (Id. at p. 252; Emphasis in Nazir.)

Valerio v. Andrew Youngquist Construction (2002) 103 Cal.App.4th 1264, 1271 (Valerio), states, “Valerio admitted the existence of a written contract in his answer to the cross-complaint. The admission of fact in a pleading is a ‘judicial admission.’ Witkin describes the effect of such an admission: ‘An admission in the pleadings is not treated procedurally as evidence; i.e., the pleading need not (and should not) be offered in evidence, but may be commented on in argument and relied on as part of the case. And it is fundamentally different from evidence: It is a waiver of proof of a fact by conceding its truth, and it has the effect of removing the matter from the issues. Under the doctrine of “conclusiveness of pleadings,” a pleader is bound by well pleaded material allegations or by failure to deny well pleaded material allegations. [Citations.]’ [Citation.]” (Italics in Valerio.)

Defendants move for summary adjudication as to the second cause of action (Violation of California Business and Professions Code section) 17200, third cause of action (Interference with Economic Relations), and claim for punitive damages contained in Plaintiff’s (Myers & Sons Construction, LP) First Amended Complaint (FAC) filed on 4-27-21 under ROA No. 51. (Notice; 2:1-22)

Renewed Motion for Summary Adjudication:

Plaintiff’s (Myers & Sons Construction, LP) Opposition to Defendants’ Motion for Summary Adjudication (Opposition), filed on 11-22-22 under ROA No. 169, relies on Code of Civil Procedure section 437c, subdivision (f)(2), and states, “Defendants cite no ‘change of law’ or facts to support the motion.   Not do any of the alleged ‘newly discovered facts’ support Defendants reasserting these issues before the court.”  (Opposition; 1:27-28.)

The court denied Defendants’ prior motion for summary adjudication of the second cause of action, third cause of action, and claim for punitive damages in Plaintiff’s First Amended Complaint (FAC) on 6-7-22. (6-7-22 Minute Order.)  The Motion raises substantially similar issues regarding the second and third causes of action and claim for punitive damages as the first Motion for Summary Adjudication filed on 1-25-22 under ROA No. 92 (First Motion).

Bagley v. TRW, Inc. (1999) 73 Cal.App.4th 1092, 1096, footnote 3 (Bagley), states, “Although this language has been a part of the summary judgment statute since 1991 (Stats. 1990, ch. 1561, § 2, p. 7332), Bagley and TRW have not cited it in their briefs, and instead direct their attention to section 1008, the statute generally governing motions for reconsideration. Quite clearly, this case must be decided by the specific requirements of the summary judgment statute, not the general provisions of the reconsideration statute. (Wilson v. Board of Retirement (1957) 156 Cal.App.2d 195, 211 [319 P.2d 426].) This is particularly true where, as here, the prohibition against repeated summary judgment motions was added to make the summary judgment process more efficient and to reduce the opportunities for abuses of the procedure (Sen. Rules Com., Off. of Sen. Floor Analyses, rev. of Sen. Bill No. 2594 (Aug. 23, 1990)) which the addition of subdivision (f)(2) accomplished by overruling the cases that had held that an order denying a motion for summary judgment did not preclude a renewal of the same motion at any time before trial. [Citations.]”

The Motion identifies Fact Nos. 18, 19, and 37 as facts based upon new discovery. (Motion; 7:11-12 (See, Plaintiff’s Separate Statement (PSS) filed on 11-22-22 under ROA No. 171.)  Defendants submit the following evidence in support of the Motion which was not submitted in support of the First Motion: (1) Plaintiff’s 8-2-22 responses to written discovery. (Defendant’s Compendium of Exhibits (COE) filed on 11-22-22 under ROA No. 171, Exhibit 2; PSS No. 18.); (2) A 12-8-21 letter from Reem Hashem to OC405 JV’s Alex Medyn. (COE, Exhibit 5; PSS No. 18.); (3) A 12-15-21 letter from Mr. Medyn to OCTA’s Jeff Mills. (COE, Exhibit 6; PSS No. 18.); and (4) Excerpts from the 5-18-22 deposition testimony Reem Hashem. (COE, Exhibit 5; PSS No. 18.)

As to the First Motion, Defendants chose to Rely on allegations in Plaintiff’s FAC and their Request for Judicial Notice to support the First Motion. (Defendant’s Separate Statement as to the First Motion (DSS1) filed on 1-25-22 under ROA No. 86.)  Here, it appears that the December 2021 correspondence was available to Defendants when Defendants file the First Motion.  The 12-8-21 letter was directed to “Mr. Alex Medyn” as Defendant—OC 405 Partners Joint Ventures; “Project Manager.” (COE, Exhibit 5.) Thus, the 12-8-21 letter was available to Defendants before Defendants filed the First Motion.  On 12-15-21, Alex Medyn as “OC 405 Partners J.V.’s Project Director” sent a letter to the Orange County Transportation Authority (OCTA).  Thus, the 12-15-21 letter was available to Defendants before Defendants filed the First Motion.  Defendants’ Reply in Support of Motion for Summary Adjudication (Reply), filed on 12-1-22 under ROA No. 179, does not provide an explanation as to why Defendants did not provide this evidence to the court with the First Motion. (Reply; 2:8-21.)  As to Exhibit Nos. 5 and 6 attached to the COE, the court finds that these exhibits are not newly discovered evidence within the meaning of Code of Civil Procedure section 437c, subdivision (f)(2), because Defendants had access to these documents before the filing of the First Motion.

As to the discovery received after the filing of the First Motion, Defendants have not explained why Defendants could not have served the written discovery and taken the deposition of Reem Hashem before Defendants filed their First Motion. (Reply; 2:8-21.)  Code of Civil Procedure section 437c, subdivision (f)(2), however, does not contain a reasonable diligence requirement.  It appears that the delay in serving the written discovery and the taking of the deposition of Reem Hashem undermines the the public policy behind section 437c(f)(2) as described in Bagley.  Since Code of Civil Procedure section 437c, subdivision (f)(2), does not contain a reasonable diligence requirement, the court finds that the written discovery and the deposition of Reem Hashem constitutes newly discovered evidence because it was not available at the time of the filing of the First Motion.  Therefore, the court will exercise its discretion and consider the Motion.

First Issue:  “As to the Second Cause of Action for Violation of California Business and Professions Code § 17200: [¶] a. No genuine issue of material fact exists that Defendants do not continue to represent that Plaintiff is a subcontractor on the Project. [¶] b. No genuine issue of material fact exists that Plaintiff suffered no harm as a result of any alleged violation of California Business and Professions Code § 17200.”

The FAC pleads that Defendant—OC 405 Partners Joint Venture (OC 405) violated the Subletting and Subcontracting Fair Practices Act (SSFPA) by secretly substituting Plaintiff “. . . out as the Primary Bridge Contractor in favor of themselves and MCM Construction, either because they never intended to use MYERS & SONS CONSTRUCTION, LP other than to secure the I-405 Improvement Project, or to cut costs after the Defendants underbid the Project by $272 million. (FAC, ¶ 61; Capitalization in FAC.)

Section 7.2.1 of the Design-Build Contract identifies “. . . certain Subcontractors for the Project, as listed in Appendix 5 . . . .” (Plaintiff’s Evidence in Opposition to Defendant’s Motion for Summary Adjudication (PE) filed on 11-22-22 under ROA No. 175; Exhibit 3.) Appendix 5 designates Plaintiff as a “Primary Bridge Contractor.” (PE, Exhibit 5.) Section 7.2.3 of the Design-Build Contract states in part, “Design-Builder shall not have the right to make any substitution of identified DBE Subcontractors . . . without approval from the Authority. . . .” (PE, Exhibit 5.)

Bernardo v. Planned Parenthood Federation of America (2004) 115 Cal.App.4th 322, 351-352 (Bernardo), states, “An ‘unlawful’ business practice or act within the meaning of the UCL ‘is an act or practice, committed pursuant to business activity, that is at the same time forbidden by law. [Citation.]’ [Citation.] The California Supreme Court has explained that ‘[b]y proscribing “any unlawful” business practice, “[Business and Professions Code] section 17200 ‘borrows’ violations of other laws and treats them as unlawful practices” that the unfair competition law makes independently actionable. [Citation.]’

[Citation.]” (Italics in Bernardo.)

Lueras v. BAC Home Loans Servicing, LP (2013) 221 Cal.App.4th 49, 80-81 (Lueras), states, “The UCL permits civil recovery for ‘any unlawful, unfair or fraudulent business act or practice and unfair, deceptive, untrue or misleading advertising. . . .’ (Bus. & Prof. Code, § 17200.) ‘ “Because Business and Professions Code section 17200 is written in the disjunctive, it establishes three varieties of unfair competition—acts or practices which are unlawful, or unfair, or fraudulent. . . .” ’ [Citation.] [¶] By defining ‘unfair competition’ to include any unlawful act or practice, the UCL permits violations of other laws to be treated as independently actionable as unfair competition. [Citation.] ‘ “[A]n ‘unfair’ business practice occurs when that practice ‘offends an established public policy or when the practice is immoral, unethical, oppressive, unscrupulous or substantially injurious to consumers.’ [Citation.]” [Citation.]’ [Citation.] An unfair business practice also means ‘ “the public policy which is a predicate to the action must be ‘tethered’ to specific constitutional, statutory or regulatory provisions.” ’ [Citation.] A fraudulent practice under the UCL ‘require[s] only a showing that members of the public are likely to be deceived’ and ‘can be shown even without allegations of actual deception, reasonable reliance and damage.’  [Citation.]” “The Kwikset court held a plaintiff can satisfy the economic injury prong of the standing requirement in ‘innumerable ways’ but listed four injuries that would qualify under section 17204: (1) the plaintiff surrendered more or acquired less in a transaction than the plaintiff otherwise would have; (2) the plaintiff suffered the diminishment of a present or future property interest; (3) the plaintiff was deprived of money or property to which the plaintiff had a cognizable claim; or (4) the plaintiff was required to enter into a transaction, costing money or property, that would otherwise have been unnecessary. [Citation.]” (Id., at pp. 81-82.)

Defendants have not carried their initial burden of demonstrating that Plaintiff cannot establish one or more of the elements necessary for a violation of Business and Professions Code section 17200 based on PSS No. 18. First, PSS No. 18 states, “Defendants do not continue to represent that Plaintiff is a subcontractor on the Project.” In support of UMF 18, Defendants cite Plaintiff’s Responses to Special Interrogatories, Set No. 2, Interrogatory Nos. 72, 78 and 89, the December 2021 correspondence, and the excerpts from the 5-18-22 deposition of Reem Hasehem.

Plaintiff, however, has demonstrated a triable issue of material fact dispute as to UMF 18, including Plaintiff’s response to Special Interrogatory no. 72, which states in part, “Defendants have also not provided a satisfactory answer to OCTA as to whether they have unlawfully substituted MYERS & SONS CONSTRUCTION, LP out as the Primary Bridge Subcontractor as set forth in the Deposition of Reem Hashem Contacts Manager for OCTA.”  Plaintiff provides additional testimony from the deposition of Reem Hashem that states,  Plaintiff also adduces additional testimony of Reem Hashem, stating that Defendants have not responded as to whether Plaintiff has been substituted as a subcontractor. (Widders Decl., ¶ 3 and Exhibit 2; Hashem Depo., 42:7-20.)  Therefore, there is a triable issue of material fact as to whether Defendants have committed an underlying violation of the SSFPA to support the second cause of action. (See FAC, ¶¶ 65.)

Second, PSS No. 19 states, “Plaintiff suffered no harm as a result of any alleged violation of California Business and Professions Code § 17200.”

Plaintiff has demonstrated a triable issue of material fact as to PSS No. 19 including evidence of a wrongful death lawsuit that has been filed by a third party based on Plaintiff’s apparent involvement in the Project. (PE, Exhibit 4.)  The Reply states, “. . . Plaintiff submits no evidence that it suffered ‘lost money or property’ as a result of being served with the referenced lawsuit.”  PSS No. 19, however, does not does not support this contention. The existence of the wrongful death lawsuit is sufficient to demonstrate a triable issue of material fact as to Plaintiff’s damages arising from Defendant’s unlawful conduct in violation of the SSFPA.

The court therefore DENIES the Motion as to Issue No. 1.

Second Issue: “As to the Third Cause of Action for Interference with Economic Relations. [¶] a. No genuine issue of material fact exists that Plaintiff was not in an economic relationship with the Orange County Transportation Authority (‘OCTA’).”

CACI No. 2201 sets for the elements necessary to state an cause of action for Intentional Interference with Contractual Relations. Pacific Gas & Electric Co. v. Bear Stearns & Co. (1990) 50 Cal.3d 1118, 1126 (Pacific Gas), states, “The elements which a plaintiff must plead to state the cause of action for intentional interference with contractual relations are (1) a valid contract between plaintiff and a third party; (2) defendant's knowledge of this contract; (3) defendant's intentional acts designed to induce a breach or disruption of the contractual relationship; (4) actual breach or disruption of the contractual relationship; and (5) resulting damage. [Citations.]”

CACI No. 2202 sets for the elements necessary to establish a cause of action for Intentional Interference with Prospective Economic Relations. Roy Allan Slurry Seal, Inc. v. American Asphalt South, Inc. (2017) 2 Cal.5th 505, 512 (Roy Allan), states, “Intentional interference with prospective economic advantage has five elements: (1) the existence, between the plaintiff and some third party, of an economic relationship that contains the probability of future economic benefit to the plaintiff; (2) the defendant's knowledge of the relationship; (3) intentionally wrongful acts designed to disrupt the relationship; (4) actual disruption of the relationship; and (5) economic harm proximately caused by the defendant's action. [Citation.]”

Roth v. Rhodes (1994) 25 Cal.App.4th 530, 546, states, “. . . [A]n essential element of the tort of intentional interference with prospective business advantage is the existence of a business relationship with which the tortfeasor interfered. [Citation.] . . . Although this need not be a contractual relationship, an existing relationship is required. [Citation.]”

PSS No. 37 states, “Plaintiff was not in an economic relationship with OCTA.” PSS No. 37 relies on Plaintiff’s responses to Special Interrogatories, Set No. Two.  Special Interrogatory No. 60, states, “State all facts supporting YOUR contention there existed an economic relationship between YOU and Orange County Transportation Authority (hereinafter ‘OCTA’) RELATING TO (the terms ‘RELATE TO’ and ‘RELATING TO’ shall mean in whole or in part constituting, embodying, reflecting, identifying, stating, referring to, evidencing, or in any way being relevant to that given subject) the PROJECT (‘PROJECT’ shall refer to the public work of improvement commonly referred to as the 1-405 Improvement Project located in Orange County, California).”  (COE, Exhibit 2; Uppercase in Special Interrogatory No. 60.)

Plaintiff’s response to Special Interrogatory No. 60 states in part, “MYERS & SONS CONSTRUCTION, LP is listed in the Contractor (sic) and was not properly substituted out as stated by OCTA, ‘in potential violation of the Contract and the Subletting and Subcontracting Fair Practices Act, Public Contract Code section 4100 et seq.’ ”  In response to PSS No. 37, Plaintiff cites pages 15-16 of the Hashem deposition (Widders Decl., ¶ 3 and Exhibit 2; Hashem Depo., 15:5-16:6), and Exhibit 2 to the FAC, which define “Major Participant” for purposes of the Project. Plaintiff contends that it has an economic relationship with OCTA as a “Major Participant” in the Project. (Opposition; 9:18-10:10.)

Defendants have met their burden of demonstrating there is no triable issue of material fact as to the third cause of action because Defendants have demonstrated there was no economic relationship between Plaintiff and OCTA base on Plaintiff’s response to Special Interrogatory No 60. Plaintiff has failed to demonstrate a triable issue of material fact as to the existence of an economic relationship with OCTA because there is no evidence of a contract or other business relationship between Plaintiff and OCTA. Plaintiff’s status as a “Major Participant” in the Project does not constitute an independent business relationship between Plaintiff and OCTA.

Therefore, the court GRANTS the Motion as to Issue No. 2.

Third Issue: “As to the Claim/Prayer for Punitive Damages. [¶] a. No genuine issue of material fact exists that Plaintiff cannot prove an underlying tortious act.”

Plaintiff’s prayer for damages in the FAC includes a prayer “For exemplary and punitive damages as to the third, fourth and sixth causes of action for ten times the actual damages.” (FAC; 34:14-15.) In the court’s 6-7-22 Minute Order, the court granted summary adjudication as to Plaintiff’s fourth and sixth causes of action in the FAC. Based on the present order granting summary adjudication as to the third cause of action, the FAC does not contain a cause of action that supports an award of punitive damages.

Therefore, the court GRANTS the Motion as to Issue No. 3.

Based on the above, the court GRANTS Defendants’ (OHL, USA, Inc., Astaldi Construction Corporation and OC 405 Partners Joint Venture) Motion for Summary Adjudication, filed on 9-22-22 under ROA No. 157, as to Issue Nos. 2 and 3.  The court DENIES the Motion as to Issue No. 1.

Defendants are to give notice.